Sunday, November 30, 2008

Social Network Users Less Receptive To Advertising

More than half of U.S. consumers with Internet access use social networking services (SNS), such as Facebook and MySpace, and penetration will continue to grow. According to a new study from IDC, consumers are also spending ever-greater amounts of time on SNS, a fact that has advertisers drooling over the opportunity represented by SNS.

IDC found that consumers who use SNS also tend to visit the services often and spend a lot of time per visit. More than three quarters of SNS users visit at least once a week, and no less than 57% visit at least once a day. During each session, 61% of SNS users spend at least 30 minutes on the respective site or stay logged in permanently, and 38% spend at least one full hour per session (or stay logged in).

There are four major reasons why consumers use SNS: to connect and communicate; in response to peer-pressure; for entertainment; and for work-related purposes. Advertising does not factor into consumer motivations. In fact, users are less tolerant of SNA advertising than the best tolerated forms of online advertising. Ads on SNS have lower click-through rates than traditional online ads (on the Web at large, 79% of all users clicked on at least one ad in the past year, whereas only 57% of SNS users did), and they also lead to fewer purchases (Web: 23%; SNS 11%).

One of the potential benefits of SNS that the advertising industry has discussed is whether peoples’ connections (i.e., whom a user knows or is linked to) could be used for advertising. For instance, publishers could show a car manufacturer's ads to a user's contacts because that user's online behavior has indicated that she is interested in a particular brand of cars. Anecdotally, there has been some indication that this "social advertising" might be more effective than behavioral targeting. However, that idea is stillborn. Of all U.S. Internet users, only 3% would allow publishers to use contact information for advertising.

IDC expects that lower-than-average ad effectiveness on SNS will continue to contribute to slow ad sales unless publishers get users to do something beyond just communicating with others. If the major services succeed in doing so, they will become more like portals, such as Yahoo! or MSN, and they will come closer to the audience reach of the top services. If that happened, publishers would be better able to monetize their SNS.

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Monday, November 24, 2008

Retailers Counting on Cyber Monday as Bright Spot of Challenging Holiday Season

People who don’t want to fight Black Friday crowds will have a less chaotic shopping option just three days later. Cyber Monday, the Monday after Thanksgiving, is expected to be more promotional than ever this year as retailers offer one-day sales and special offers to bring holiday shoppers online.

On Cyber Monday, the ceremonial kickoff to the online holiday shopping season, online retailers will debut thousands of promotions to show what websites have to offer this holiday season. According to the eHoliday Survey, conducted for this fall by Shopzilla, 83.7 percent of retailers will have a special promotion for Cyber Monday, up from 72.2 percent last year. The most popular promotions are expected to be specific deals (38.8%), email campaigns (32.7%), and one-day sales (24.5%). Additionally, nearly one-fourth of retailers (22.5%) will offer free shipping on all purchases.

Cyber Monday, a term coined by in 2005, began after online retailers noticed a trend of people shopping online on the Monday after Thanksgiving. Since then, consumers have flooded websites on Cyber Monday and come to expect robust promotions and specials that day.

To get a handle on holiday shopping, office workers won’t be heading to the mall over their lunch hour, they’ll be staying at their desk. This year, according to a BIGresearch survey conducted for, 55.8 percent of workers with Internet access, or 72.8 million people, will shop for holiday gifts from work. The trend of employees with internet access shopping from the office has continued to increase: in 2005, only 44.7 percent said they shopped online from work.

Though slightly more than half of workers will be shopping from the office, some are more likely to make a dent in their wish lists than others. According to the BIGresearch survey, 70.0 percent of young adults 18-34 with Internet access will shop at work. Additionally, men are more likely to shop from work than women (60.3% vs. 51.5%).

Though retailers will be going all-out for Cyber Monday this year, many are also planning to use their websites to drive traffic to stores for Black Friday. According to the eHoliday study, one-fourth of retailers (28.6%) plan to increase online marketing of Black Friday promotions this year. Marketing will include emails about stores’ Black Friday deals (74.3%), mention of Black Friday deals on the retailer’s home page (62.9%) and search marketing (54.3%).

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Thursday, November 20, 2008

Yankee Group Says Anywhere Is Hot for the Holidays

In a new report, They Want Their Anywhere for the Holidays, Yankee Group identifies connectivity as the holiday's hottest gift trend and suggests electronic devices for a wide range of consumers. From mobile hardware to wireless media players, this year’s holiday buying season will be shaped by the demands of five consumer segments defined in the Yankee Group Report, They Want Their Anywhere:

Actualized Anywheres: These consumers constantly crave connectivity and will be most attracted to integrated free mobile broadband connectivity products, which will allow them to indulge their connectivity addiction on the go. Recommended gifts for Actualized Anywheres include:
--The Amazon Kindle
--The Slingbox PRO-HD
--TomTom x40 GO LIVE

Outlet Jockeys: This consumer segment wants a rich and productive technology experience, both on the go and at home. The ideal holiday gift will offer them the opportunity to do both. Recommended gifts for Outlet Jockeys include:
--Gift certificates for iPhone applications
--Eye–Fi Explore SD Card
--Logitech Squeezebox or Squeezebox Boom Music Players

Digital Shut-ins: These consumers seek to enhance their home hardware, such as HDTVs, with additional services. Recommended gifts for Digital Shut-ins include:
--The Roku Netflix Box/Xbox 360
--SlingCatcher Universal Media Player
--Peek Wireless E–Mail Device

Technophytes: This group of consumers looks for cutting-edge technologies at bargain prices. Luckily, this holiday season offers a plethora of affordable consumer electronic gadgets. Recommended gifts for Technophytes include:
--Linksys Ultra RangePlus Wireless–N Broadband Router
--Slacker G2 Personal Radio
--Asus Eee PC S101

Analogs: Because they have little interest in technology for the sake of technology, these consumers want gadgets that simplify activities they are already doing. Recommended gifts for Analogs include:
--Kodak EASYSHARE W820 Wireless Digital Frame
--Lexmark Z1480 Wireless Printer

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Monday, November 17, 2008

Online Consumers Plan to Spend Less in Stores, But Slightly More Online This Holiday Season

Online consumers intend to spend less in stores this holiday season than last year, The Conference Board and TNS report, but slightly more online. Consumers will be expecting free shipping and deals not available in stores when they shop online.

Even though online shoppers plan to spend less in stores this holiday season, planned spending online is up slightly, compared to the same quarter last year. Online households planning to spend more than $500 in stores declined to 16 percent from 21 percent last year. Those planning to spend more than $500 online rose to 5 percent from 4 percent last season. Those planning to spend between $100 and $499 in stores declined to 57 percent from 61 percent last year, while those planning to spend that amount online edged up to 36 percent from 35 percent last year. Online households planning to spend less than $100 in stores increased to 22 percent from 16 percent last year. Those planning to spend that amount online rose to 32 percent from 29 percent.

Retail and Catalogue Sites Most Popular

This holiday season, books, clothes, movies and toys will be the most popular items on the consumer's Internet shopping list. The most preferred shopping sites are those operated by retail store and catalogue operators such as or, followed by online retailers such as and online auction sites such as

Women shoppers are shifting from retail and catalogue sites to online retailers this year, perhaps in search of better prices. Female shoppers who preferred retail and catalogue sites dropped to 42 percent from 48 percent in 2007, while female shoppers who prefer online retailers have grown to 40 percent from 34 percent last year. Site preferences for male shoppers only changed slightly.

Shopping Habits Differ Among Genders

Consumers are very aware of the cost benefits between shopping in stores and online. Self-identified bargain hunters account for 44 percent of shoppers who made an online purchase in the past three months, the same as a year ago. Die-hard Internet shoppers have increased slightly and represent 17 percent of shoppers. They are the second most common type of Internet shopper. Traditional shoppers, who occasionally shop online but prefer the familiarity of real stores, account for about 15 percent of online shoppers. Last resort shoppers, who buy online only when products are unavailable in stores, rank fourth on the list and represent 14 percent of online shoppers. Lastly, hurried shoppers, who point and click only when pressed for time, represent 10 percent of online shoppers.

Among bargain hunters, men are more likely than women to surf the Internet searching for deals. Only 41 percent of women compared with 48 percent of men are self-proclaimed bargain hunters. Last resort shoppers and hurried shoppers, however, are more likely to be women. About the same proportion of men and women are Internet die-hards and traditional shoppers.

Consumers More Cost Conscious

Shipping charges, which are the most frustrating aspect of online shopping, tend to frustrate women more than men, 47 percent versus 38 percent respectively. The ongoing sentiment among online holiday shoppers is that free shipping, coupons and discount offers would encourage them to spend more online. About 93 percent of women versus 87 percent of men say free shipping would serve as a motivation to spend more online this holiday season. More than 71 percent said special offers and deals not available in stores would boost their online spending, with little difference between men and women. More than 70 percent of women and 68 percent of men said they would be willing to spend more if merchants offered coupons/discounts. In concert with shipping cost frustrations, 48 percent of women say they would spend more online if sites offered free return postage, compared with 39 percent of men who felt this way.

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Thursday, November 13, 2008

SaaS Adoption Nearly Doubles

A recent survey by Cutter Consortium revealed that 63% of responding organization are using a software-as-a-service (SaaS) solution, up from 32% in 2007.

There are plenty of external forces pushing organizations to adopt SaaS: A combination of a higher TCO for IT systems and business applications, along with lower ROI has proven to be a disastrous equation for many organizations that are now confronted with a worldwide economic crisis that is placing greater constraints on operating budgets. The financial challenges are coming at the same time that the competitive landscape is being reshaped by globalization and e-commerce. Simultaneously, the traditional workplace is a thing of the past. Mobile workers need to access corporate data and need to collaborate with their peers, raising a new set of management and security challenges.

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Monday, November 10, 2008

Financial Institutions Must Focus on IT Innovation or Hibernate to Weather the Economic Downturn

Financial services institutions must focus on IT innovation for radical change or hibernate to minimize cost and prepare for later action to survive the economic downturn, according to Gartner, Inc. Organizations that choose the middle ground risk wasting their IT budget on incremental modernization for little gain.

Organizations that hibernate are making a conscious decision to prepare for survival by avoiding IT change until absolutely necessary. They take a short- to medium-term approach, keeping their systems running for the absolute minimum cost while building up a war-chest of savings for later use on smart, innovative activities as and when market conditions improve. Gartner defines companies that innovate as at the leading edge of technology and embrace the big bang approach. They develop accurate cost-benefit models that link IT changes to business metrics so that they can quantify benefits and justify the radical transformations they encourage.

Gartner outlined four examples of how companies can embed innovation in their corporate culture and agenda:

-- Re-design branches to sell and advise – Banks must re-learn how to engage customers after pushing many away from branches through telephone and internet banking. With the help of branch automation and solid multi-channel integration banks can engage customers for transactions that add value to the relationship and make the purchase of new products and services streamlined.

-- Extreme but not complex innovation – Use technology to deliver a new level of personalization for the customer. For example, one Spanish bank allows its customers to calculate exactly how much the bank profits from their custom and enables them to donate a portion of those profits to a designated charity. In India, another bank provides easy access to a ‘Do Not Call’ register on the front page of its internet banking home page.

-- Treat customers as innovators via social networks – Customers can answer most of what organizations want to know about them, whether it’s where they shop, how they feel and what and when they want to purchase. Some new financial services entrants such as the social networking start-ups, are trying to leverage customers more effectively using this technology and customers’ increasing acceptance and use of it. The next innovation step will be to bridge the gap between pure social networks and financial social networks (FSNs). FSNs are leveraging social networks to initiate a new form of financial transaction, allowing members to not only share information but to actually start lending and borrowing to each other, cutting out the middle man – in this case the bank.

-- Innovation in payments – Financial services companies are gradually recognizing the role they need to take to transform their approach to payments if they are to maintain a payments franchise, as well as the role that payments can play in their customer propositions. Some of the innovations around payments are focused at the payment applications themselves and result in the deployment of multi-application cards and the use of loyalty applications. However, many innovations in payments will be invisible to customers, focusing instead on the more effective use of payment data and the re-architecting of bank payment infrastructures to support the deployment of organization-wide payment hubs

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Tuesday, November 4, 2008

Forrester Projects Which Enterprise Web 2.0 Collaboration Technologies Will Grow, Which Will Decline

As IT departments struggle to justify technology spend during trying economic times and vendor companies look to capitalize on the exploding market for social technologies, Forrester Research, Inc. has released new research that tracks the business value, maturity, and future adoption of enterprise Web 2.0 collaboration tools.

According to Forrester, social networking tools and internal wikis will have the greatest impact on workplace collaboration. Technologies such as forums and RSS have a future in the enterprise but are currently underused, while podcasts have a limited future as an enterprise tool to increase productivity and enhance collaboration.

Forrester previously estimated the enterprise Web 2.0 collaboration market will hit $1.8 billion by 2013. The enterprise Web 2.0 TechRadar study is based upon an analysis of previous research and interviews with industry experts, vendors responsible for building or implementing these technologies, and enterprise customers and users.

Forrester predicts the following Web 2.0 collaboration technologies will continue to experience growth:

-- Social networks will transform the nature of work. Social networks provide context to content. Cultural resistance exists, but Forrester believes this will eventually break, allowing workers to connect with like-minded colleagues and enabling a collaboration channel that previously didn’t exist in the enterprise.

-- Wikis help transform collaboration. One of the most promising Web 2.0 technologies for the enterprise, users report success with Wiki endeavors, particularly when sponsored by business leaders and connected to business processes, and the market shows signs of strong growth.

-- Blogging is not going away — but it does not capture or hold the attention of an enterprise audience. Social networks will breathe new life into internal blogs by providing more context to blogged content, but Forrester found that blogging alone does not capture the attention of an enterprise audience.

-- RSS is underappreciated in the enterprise. This ubiquitous technology provides a mechanism to get content to people where they need it, rather than expecting people to find it.

The following Web 2.0 technologies have large and resilient ecosystems and can last for several years or even decades but, over time, the markets will become highly consolidated, customer numbers will flatten, and revenues will level off or decline:

-- Podcasting is on the decline. Users tell Forrester that podcasts in the context of enterprise productivity and collaboration are neither very engaging nor immersive, and the vendor landscape is shrinking.

-- Forums are underused. While forums will continue on as a fundamental enabling technology for collaboration, the marketplace is flat, and forums will become part of larger community-focused packages.

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Sunday, November 2, 2008

Worldwide Web Conference and Team Collaboration Software Market On Pace to Grow 22 Per Cent in 2008

Technology convergence and consolidation, coupled with an increased emphasis on workplace communities, are the key forces keeping the worldwide web conference and team collaboration software market revenue on pace to reach $2 billion in 2008, according to Gartner, Inc. This represents an increase of 22 per cent growth in worldwide software revenue compared with 2007.

In Europe, Middle East and Africa (EMEA), the total market for web conferencing and collaboration software market revenue is set to grow 28.6 per cent to reach $500.3 million in 2008, with strongest growth from Eastern Europe, which is on track to increase 55.3 per cent from 2007. Western Europe, which holds 90 per cent market share of the web conference and collaboration market in EMEA, is expected to grow 26.5 per cent while the Middle East and Africa will increase 45 per cent year-on-year.

Cultural differences also play a strong role in adoption of collaboration technologies. It is more common in North America and Europe to have meetings and other forms of interpersonal communications supported by collaboration tools. In Latin America and the Middle East and Africa, e-mail is used as the primary mode of communications in lieu of horizontal collaboration technologies. In Asia/Pacific and Japan, face-to-face meetings are preferred, and at times, business travel for meetings is seen as a prerequisite.

Although, it is difficult to measure the business value of interactions, a strong and growing demand exists within organizations for real-time and team-based collaboration technologies. Technologies such as instant messaging (IM) are increasingly viewed as birthright technologies, akin to email. Gartner anticipates that IM will become as popular as email by 2010. Videoconferencing will evolve to the desktop to support ad hoc conversations and become better integrated with web conferencing, IM and voice over IP (VoIP).

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